Financial instruments have significant importance in finance and trade. Such financial instruments have a monetary value associated with them and hence they are used as a tradable asset. Since these financial instruments carry monetary value vested in them, they are representative of a legal binding and hence used for non-cash payments or transactions between two parties. There are a number of financial instruments available in the market in different shapes, sizes and in appearance such as a check/cheque, traveler's check/cheque, banker's draft, bill of exchange, promissory note, certificate of deposit, money orders, payment cards, demand draft, bonds etc. The financial instruments can be negotiable or non-negotiable. The non-negotiable financial instruments are only intended for a payee whose name is mentioned on the financial instrument. The negotiable instrument however can be claimed by any bearer by presenting his identification during deposit or encashment. These financial instruments may be issued by financial institutions like central banks, commercial banks, investment banks, credit unions etc. to a payor or a drawer. For issuing these financial instruments, the financial institution has to comply with certain set of standards, regulations and has to bear its associated cost during its manufacturing and distribution.
Financial instruments can be used for only one financial transaction that is consummated when settled in cash or electronic funds transfer. Thus, due to their characteristic nature of one-time use, the value of these consummated financial instruments i.e., after completing their transactional cycle, is exhausted to nothing less than a blank paper or blank object. Moreover, a lot of effort is required for securely recycling these consummated financial instruments (usually blank papers) for converting them into new paper products. Also, another concern that arises is maintenance of separate counters and designation of qualified human resources for manning these counters in order to securely issue, dispatch, process, and/or receive these financial instruments for performing the intended financial transactions.
Since, these financial instruments which are issued to the payor are limited in number, yet another concern comes into scenario wherein, the payor has to visit the respective financial institutions in-person. After consuming the financial instruments held, the payor may have to physically visit his respective financial institutions for receiving a new set of financial instruments. Thus, obviating the requirement to physically visit the financial institution and waiting period for issuance of fresh financial instruments is also an unaddressed need in the art. Thus, considering the above limitations which exist in the present scenario, there is a long felt need for a reusable financial instrument, a method and a system for enabling the reuse of such financial instrument for performing multiple financial transactions between two parties. Further, there is also a need to maintain authenticity and security of such reusable instruments and transactions thereof, since such instrument are prone to counterfeiting and fraud. Having only physical instruments or only electronic instruments have not been able to address these concerns. Thus, there is a need for method and system for security of the data and to ensure integrity; confidentiality of the data associated with the financial transactions processed using the financial instruments. Also, there is no mechanism available in the art to aggregate data from various types of financial instruments on a single financial instrument and then complete the transaction using the said single financial instrument. Thus, there is a long felt need to have an article, system and method that securely aggregates data from varied types of financial instruments for a transaction. This includes the need for cross-instrument transfer to a common instrument so that the common instrument acts as a carrier instrument that can be further processed.